Bitcoin and Ethereum took a steep dive as market-wide selloffs triggered a sharp downturn, while gold hit new record highs.
Bitcoin critic and Europac chief economist Peter Schiff wasted no time taking a jab at crypto enthusiasts.
“In case you haven't noticed, Bitcoin is down 7% tonight, trading just above $93,000, but Ethereum is crashing,” Schiff wrote on X. “It’s down 20%, trading below $2,500, but an hour ago it hit $2,100, down about 33% in one night! It looks like Punxsutawney Phil was right about that long crypto winter.”
Each year on Feb. 2, Punxsutawney Phil emerges from his home to forecast the upcoming weather. If he sees his shadow, it signals six more weeks of winter; if not, an early spring is expected. This year, Phil saw his shadow, predicting another six weeks of winter, according to AP News.
Peter Schiff linked Phil’s prediction to the ongoing market-wide decline, calling it a “cryptocurrency winter” — a period when cryptocurrencies experience massive losses.
Schiff, a long-time gold advocate, doubled down on his stance, arguing that now is the perfect time for Bitcoin holders to move into gold.
“You have that backwards. Now is a perfect time for HODLs to sell their Bitcoin to buy gold. Bitcoin is close to a record high versus gold,” he added .
Meanwhile, Anthony Pompliano, a Bitcoin supporter, flipped Schiff’s argument and suggested the U.S. should trade gold for BTC instead.
“Gold just hit a new all-time high, so this is the perfect time for the United States to sell its gold and buy Bitcoin,” Pompliano said. “Sell the old store of value for an improved, digital version.”
Bitcoin, Ethereum, and altcoins tumble
On Feb. 3, Bitcoin fell 7% in the past 24 hours, trading at $95,626.85, as the global crypto market cap shrank 8.7% to $3.24 trillion.
Ether suffered even more, dropping as much as 33% in one night before recovering slightly. The losses extended to altcoins, with XRP, Dogecoin, and Cardano falling over 25%, erasing months of gains. Many major tokens are now down 40-50% in the past month, making this one of the worst declines in recent years.
The sharp decline was partially fueled by concerns over a potential global trade war following new U.S. tariffs on Canada and Mexico. The move rattled investor sentiment, leading to a broad risk-off shift across financial markets.
While gold surged to a record high of nearly $2,820 per ounce, it too experienced some retracement, closing January just under $2,800.
Analysts expect a short-term pullback before new highs
Paul Howard, a market analyst at Wincent, said macroeconomic uncertainty remains a key factor in crypto’s volatility.
“Cryptocurrencies, as high-risk assets, remain linked to macroeconomic factors like interest rates, inflation, and sentiment,” Howard noted. “The past two weeks saw a pro-crypto US administration take charge, with the repeal of SAB 121 and plans for a Digital Asset Stockpile. However, many hoped for a Strategic Bitcoin Reserve announcement (buying instead of holding).”
He predicts a near-term correction before long-term recovery.
“Based on previous predictions, I anticipate a short-term pullback before organic price growth resumes in the coming months. New all-time highs should still emerge later this year, following further US policy updates in Q2.”
